Delaware County Review

Congressmen Troy Balderson and August Pfluger have reintroduced legislation aimed at nullifying a guidance issued during the Biden administration. The guidance, titled "Principles for Climate-Related Financial Risk Management for Large Financial Institutions," was developed by the Federal Reserve, Comptroller of the Currency, and the Federal Deposit Insurance Corporation. It encourages financial institutions to manage climate-related financial risks associated with their investments and loans.

The lawmakers argue that this guidance could restrict funding for the American energy industry, including Ohio's oil and gas sector, which is significant to the state's economy. Balderson expressed concern over what he described as a "back-door effort to push a woke ESG agenda," suggesting that it pressures banks into prioritizing environmental policies over financial decisions.

Pfluger echoed these sentiments, criticizing what he called a politically-driven attack on American energy through mandates like 'net-zero' and 'environmental, social, and governance.' He emphasized that since President Trump returned to office, there has been a retreat from such agendas in financial markets.

Concerns have also been raised by electric grid experts about federal climate rules potentially threatening national energy security. These rules could lead to shutting down reliable power plants amid growing electricity demand. The new ESG guidance may result in regulatory challenges for banks offering services to the oil and gas industry.

In September, Balderson supported H.R. 4790, which aims to reduce burdensome ESG policies under the Biden-Harris Administration while increasing Congressional oversight of federal financial regulatory agencies.

Balderson’s bill seeks not only to nullify this specific guidance but also prevent similar future issuances by relevant federal bodies.